Fidante Partners, the multiboutique fund management arm of Sydney-based Challenger Ltd., will acquire 100% of Dexion Capital Holdings, a London-based alternatives distribution and specialist fund manager firm.
The deal — which calls for Challenger to make a fixed payment of £19.6 million ($30.4 million), followed by earnout payments to key Dexion executives for up to six years, dependent on the profitability of the business — should be completed by the end of July, said Paul Marriage, a Challenger spokesman.
Ian Saines, CEO of Challenger's fund management business, said in a news release that the acquisition will boost Fidante's presence in Europe, its international distribution and its product lineup.
Since its launch in 2000, Dexion has raised more than $18 billion in partnerships with leading alternatives investment firms such as Brevan Howard Capital Management and Pershing Square Capital Management; has built a more than £130 million white-label fund distribution business; and more recently, began adding stakes in boutique managers for which it provides marketing and operational backing, said a London-based spokesman for Dexion.
The news release said Dexion has stakes in three London-based boutiques with combined assets under management of roughly $250 million: Resonance Asset Management, a renewable energy-focused firm; Horizon Infrastructure Partnership, an investor in social housing; and Agricultural Asset Management, which makes investments in U.S. and U.K. agriculture.
Robin Bowie, Dexion Capital's founder, said in the release the tie-up with Fidante will leave both firms better placed to take advantage of fast-growing interest in alternative investments, which by 2020, could account for “15% of global assets under management and 40% of revenues.” Alternatives, meanwhile, is an area where “boutique managers punch above their weight,” Mr. Bowie added.